According to Odaily, Stournaras, a committee member of the European Central Bank (ECB), has indicated that two further rate cuts this year seem reasonable. Recent data has strengthened the rationale for further rate reductions. Even with two more cuts, the central bank's interest rates would still be at restrictive levels. Stournaras also cautioned against overinterpreting service inflation.
The ECB's decision to further reduce rates is based on recent economic data, which has provided a stronger basis for such a move. Despite these reductions, the central bank's interest rates will remain at a restrictive level, indicating a cautious approach towards stimulating the economy.
Stournaras' comments also highlighted the need to avoid overinterpretation of service inflation. This suggests a balanced approach to monetary policy, taking into account both the need for economic stimulus and the potential risks of inflation.